Perhaps the most popular question that our tax advisor gets asked is ‘what about if I have a job for a UK company and I work remotely in Spain, where do I pay my tax? Or to put it another way, what is the residence of international workers. Spanish law states that you are a tax resident in Spain when any of these circumstances arise:
a) that you stay more than 183 days in Spanish territory,
b) that the main nucleus of your activities or economic interests resides in Spain
c) or when your spouse from whom you are not legally separated and the minor children habitually reside in Spain.
Based on these criteria, any person who works from Spain and whose stay in the Spanish territory is more than 183 days within the calendar year will determine that they are considered a tax resident in Spain for the said year unless the taxpayer proves his tax residence is in another country.
However, if that worker turns out to be a tax resident in Spain and at the same time a tax resident in the United Kingdom (according to its regulations), there would be a conflict of residence between both States. How is this residency conflict resolved? Through the application of the Agreement between Spain and the United Kingdom and Northern Ireland to avoid double taxation and prevent tax evasion.
But what about the people who are teleworking from Spain and receive their income from that work, since the Spanish Treasury understands that the job is exercised in Spain, it being irrelevant that the ‘fruits’ of the work are received by a British company so that the income will only be taxed in Spain.
As with all my posts, this isn’t legal advice. If you have a tax issue here in Spain one of our lawyers Pablo has a master’s degree in tax and is available for consultations online and in person. We can also help with everything you need re moving to Spain including NIE numbers, residency or residencia, health insurance, and purchasing a Spanish property. If you’re buying a Spanish home once you have had an offer accepted by the estate agent do not sign or pay anything until you’ve taken some legal advice.
Marisa Moreno Senior Lawyer at Just Law Solicitors and Consul for Denmark
Malaga – Fuengirola – Marbella
Est. 1992 www.justlawsolicitors.com
Just Law Solicitors lecturing at the Malaga University Summer Course in Marbella